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Showing posts with label PAN NUMBER. Show all posts
Showing posts with label PAN NUMBER. Show all posts

Saturday, 31 March 2018

22:46

No Last date Yet for Aadhar Link with PAN,Bank Accounts

No Last date Yet for Aadhar Link with PAN,Bank Accounts
New Delhi, Mar 31 (UNI) Government has extended the dates for indefinite period for linking Aadhar and Permanent Account number (PAN) with bank accounts of account holders.
According to a notification issued by the Finance Ministry, this has been done in accordance with the Supreme Court Order. The new date will be announced only after the final judgement of the apex court.
The notification issued on Saturday said, “Whereas the Hon’ble Supreme Court, vide its interim order dated 13th March, 2018 in the case of Justice KS Puttaswamy (Retd.) & Anr. V. Union of India, W.P. (Civil) 494/2012 etc. (Aadhaar Cases), has extended the last date for linking Aadhaar with existing bank accounts from 31.03.2018 till the final judgement of the case.


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Saturday, 15 July 2017

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Tuesday, 13 June 2017

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Friday, 24 March 2017

15:50

PAN to lose its validity? Aadhaar may replace PAN for individuals in future

PAN to lose its validity? Aadhaar may replace PAN for individuals in future
However, the income-tax department does not have any timeframe as of now for phasing out PAN
Permanent account numbers (PAN) may be phased out in the future for individuals, but such numbers may remain there for companies.
An official said there is a possibility in the future when Aadhaar card may become the sole identity card for citizens.
However, the income-tax department does not have any time frame as of now to phase out PANs.
The Finance Bill, approved by Parliament, will make Aadhaar cards mandatory for filing income tax returns and applying for permanent account number (PAN).
Replying to a debate over the finance Bill in Parliament, Finance Minister Arun Jaitley had said it might become the only identity card and may replace PAN and voter identity card in the future.
In fact, Mohammed Salim of CPI (M) had raised this issue and expressed wonder as to why Aadhaar number can't be used for all the purposes to even replace PAN.
To this, the finance minister had said, "A stage may come when unique identity card (Aadhaar) may become the sole card. There are many countries where such a situation exists. There is a social security number in America and in India it (Aadhaar) could be the counterpart." 
Making Aadhaar mandatory for I-T returns would plug the loopholes of duplicate PANs used by some assessees to hide their identities.
As many as 98 per cent adults in the country have Aadhaar cards or have applied for the same and the technology should be used to curb tax evasion.
The government finds it appropriate to use Aadhaar for anti-evasion as some assessees are using five PANs each to dodge the system and evade taxes.
Bhartruhari Mahtab of Biju Janata Dal had referred to the Supreme Court's ruling last year that Aadhaar is not mandatory and wanted to know whether the government was "forcing" people to have it.

"Yes, we are," Jaitley had said, adding, "If the technology, which has a network of 1.08 billion people and all tax-paying households have it, and they give it along with their ITR, then the scope for fraud and tax evasion comes down."

Aadhaar has biometric details, so its chances of misuse become minimal, the finance minister had said.

"When the country has so much technology, and when it is being put to use, then why create such a hue and cry about it? It is an anti-evasion measure which will benefit the country. So the government considers it right to implement it," he had said.

Jaitley said the UIDAI had been conceptualised by the previous UPA dispensation and the NDA government is putting it to use with 98 per cent adults or more than 108 crore people in India having been issued Aadhaar number.

"We have kept a provision that a person who does not have Aadhaar can say I have applied for Aadhaar. We can't allow people to say I will not make Aadhaar, but through multiple PAN cards will continue to evade taxes," he said.

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Thursday, 2 February 2017

08:14

Strengthening of PAN quoting mechanism in the TCS regime

Strengthening of PAN quoting mechanism in the TCS regime

Statuary provisions for deduction of tax at source (TDS) at higher rate of 20% or the applicable rate whichever is higher) in case of non-quoting of Permanent Account Number (PAN) is provided under section 206AA of the Act and it exist since April, 2010.
PAN acts as a common thread for linking the information in the departmental data base. It may also be noted that the process of allotment of PAN is made simple and robust. PAN application can be made online and PAN gets allotted in less than a week.
In order to strengthen the PAN mechanism, it is proposed to insert new section 206CC to provide the following:
I. any person paying any sum or amount, on which tax is collectable at source under Chapter XVII BB (hereafter referred
to as collectee) shall furnish his Permanent Account Number to the person responsible for collecting such tax (hereafter referred to as collector), failing which tax shall be collected at the twice the rate mentioned in the relevant section under Chapter XVII BB or at the rate of five per cent. whichever is higher.
II. that the declaration filed under sub section (1A) of section 206C shall not be valid unless the person filing the declarationfurnishes his Permanent Account Number in such declaration.
III. that in case any declaration becomes invalid under sub-section (2), the collector shall collect the tax at source in  accordance with the provisions of sub-section (1).
IV. no certificate under sub section (9) of section 206C shall be granted unless it contains the Permanent Account Numberof the applicant.
V. the collector knows about the correct PAN of the collectee it is also proposed to provide for mandatory quoting of PAN of the collectee by both the collector and the collectee in all correspondence, bills and vouchers exchanged between them.
VI. that the collectee shall furnish his Permanent Account Number to the collector who shall indicate the same in all its correspondence, bills, vouchers and other documents which are sent to collectee.
VII. where the Permanent Account Number provided by the collectee is invalid or it does not belong to the collectee, then it shall be deemed that Permanent Account Number has not been furnished to the collector. 
VIII. to exempt the non-resident who does not have permanent establishment in India from the provisions of this proposed section 206CC of the Act.

This amendment will take effect from 1st April, 2017.
[Clause 72]

Source:Indian Budget 2017
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Sunday, 20 November 2016

04:49

PAN must for deposits above Rs 50K, close vigil on bank accounts

PAN must for deposits above Rs 50K, close vigil on bank accounts

The Reserve Bank of India (RBI) on Wednesday asked banks to ensure copies of PAN cards were being submitted for cash deposit exceeding Rs 50,000, if not already linked with customers’ account, to ensure tax rule compliance in the wake of the recent demonetisation move.
The RBI asked banks to insist on customers sharing their permanent account number (PAN) for all applicable transactions mandated under the Income Tax rule.
The directive follows the government order from last week that rendered the old 500 and 1,000 rupee banknotes illegal.
“With a view to ensuring compliance with provisions of 114B of the Income Tax Rules, 1962, the banks are advised that anybody depositing more than Rs 50,000 in cash in their bank account has to submit a copy of the PAN card in case the bank account is not seeded with PAN,” a notification said.
According to the 114B, every person is required to quote PAN for all documents pertaining to a time deposit with a bank or co-operative bank, post office, Nidhi or non-banking financial company which is allowed to accept deposits if the amount is more than Rs 50,000 or aggregating over Rs 5 lakh during a financial year.
Besides, customers also have to furnish PAN details for all transactions related to sale or purchase of motor vehicle/s, opening a bank account, applying a credit or debit card, opening a demat account and the like.
A customer must do so even when paying over Rs 50,000 in cash for hotels bills or travel to a foreign country or buying foreign currency.
Payment of over Rs 50,000 towards buying a mutual fund, bonds, bank drafts or pay orders and many other transactions also attract the same rules, according to the I-T ruling.
The government has been keeping a close vigil on the kind of deposits in bank accounts following the recent order and those who depositing over Rs 2.5 lakh in cash.
Banks and post offices have been asked to report to the I-T department all deposits above Rs 2.5 lakh in savings accounts, and more than Rs 12.50 lakh in current accounts, made during the 50-day window provided to tender the scrapped 500 and 1000 rupee notes.
These entities will also have to report cash deposits during the period aggregating to Rs 12.50 lakh or more, in one or more current account of a person.
The finance ministry has notified the amended Rule for filing of Annual Information Return (AIR) report by banking company, cooperative bank and post offices on account of aggregate cash deposits in one or more current account of a person.
Banks and post offices now have to file a statement of financial transaction in respect of these transactions on or before January 31, 2017, the notification said.
Earlier, they were required to report to the I-T department only when cash deposits in an account exceeded Rs 10 lakh in one full year.

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Thursday, 3 November 2016

08:06

Card Protection Plan: Should you have one?

Card Protection Plan: Should you have one?

It is human nature to stuff all cards- be it debit or credit, driving license or PAN -in a wallet which is always carried around. And when such a wallet is lost, it's a nightmare. However, the turnout wouldn't be so bad if one has subscribed to the card protection plans (CPP) offered by banks.


It is human nature to stuff all the cards - be it be debit or credit cards, driving license or PAN - in a wallet which one carries around. And when such a wallet is found to be lost, it's the procedural call that needs to be followed which proves to be a bigger nightmare. However, the turnout wouldn't be so bad if one has subscribed to the card protection plans (CPP) offered by banks.
What is CPP?
Simply put, it is a comprehensive card protection service in case of any loss, theft, fraud and other related emergencies. Apart from credit and debit cards, banks have extended this service to safeguard the details of other important documents like PAN card, Aadhar card and several others essential documents. In short, this service is designed to come in handy in times of a crisis situation. Other than this, there are several other services provided to those who signup for this offering. However, all these plans come for a limited period of one year. Thereafter, it needs to be renewed every year as in the case of insurance. Currently, most of the banks offer upto three types of plan - Classic, Premium & Platinum.
Services Offered
Banks, both public and private sector players, are offering numerous services under CPP. The benefits are almost standardized across all the players in the industry. However, the cost associated varies from Rs 1,245 to Rs 3,000, depending on the type of plan opted for. The plans vary on the basis of the number of individuals included in the plan. Broadly, the number of plan varies between two and three with inclusion classified as individual, individual+spouse and individual+spouse+parents (a total of four members). Depending on the number of persons included, the pricing of the plan offered differs. Given below are the services available.
1) One call to block all cards In case there is a loss of card, all you need to do is call the dedicated toll free number and inform about the loss of card. From thereon, the bank would take the responsibility of calling the card issuer and getting it blocked.
2) Emergency travel & hotel assistance The facility available under this head varies from bank to bank. So be careful to read the fine print. Some bank restrict this services only within India while few other banks help avail this service even overseas.
While travelling within India or abroad, incase your wallet containing cards are lost, then CPP comes to your aid in settling hotel bills. Incase of case of travel tickets, the service ensures that you get a replacement ticket. The facilitation and cost aspect in terms of settling bills and making the necessary arrangement is taken care by the banks. But remember, there is a ceiling amount for each of these services.
3) Emergency cash advances When stranded with no cash, due to loss of cards, currency, CPP ensures emergency cash advance. Again, for most of the banks this facility is available only when travelling within India. The money advanced should be paid back mostly within 28 days.
4) Valuable Document Registration In this facility, the bank allows you to register all the required details of important documents like driving license, passport, insurance policy documents etc, that you want to be maintained safely. The data stored here is easily accessible as and when needed, at any time during the day. Along with this, banks allow mobile phone identifier (IMEI) registration service as well such that incase of loss of phone, you can easily access this number to register complaint.
5) Card replacement & Passport assistance service Apart from informing the banks and initiating blocking, incase of lost cards, individuals who opted for CPP service will be aided through the procedure of getting the lost card replaced. This service ensures that al the required paper work is formally completed as required with minimum hassle to the customer.
Incase of PAN card, CPP will take care of the procedural requirement inorder to get a new card issued, at no extra cost. When it comes to passport, if the loss is when travelling overseas, it is a given that the user will be left stranded due to lack of travel documents. In such situation, certain banks will aid the traveler to notify the required authorities and also help in the process of getting a new passport issued inorder to travel back home. Here too, it is necessary to read the fine print to understand the extent to which the bank comes into assistance. Most often, the differentiation comes to the basis of the plan option chosen.
6) Sim blocking incase of loss of phone In case of loss of mobile phone, CPP will take care of reaching out to the network provider and get the SIM blocked.
7) Fraud Protection As a part of the plan, the user is protected from fraudulent use of cards arising from theft or loss of card. The cover beings from upto 15 days prior to the loss report. The number of days aspect varies according to the bank. The instances of fraud covered mostly include PIN based frauds, phishing, skimming and counterfeiting. In case of SBI, fraud protection cover is for upto Rs 3 lakh per card.
Should you go for it?
Given that credit and debit card already comes with limited liability on lost cards, it makes sense to go for these protection plans for convenience sake. Here too, only if you are a person juggling over three cards from different providers. Having such a plan ensures that you do not have to call each and every bank and get it blocked, which itself at times turns out to be very tedious procedure.
The other add-ons benefits make sense if you are a frequent traveler. Critically speaking, some of the benefits such as emergency cash advances, passport assistance incase of loss, emergency travel and hotel assistances are all covered in travel insurance. However, there is a cost attached to each of these services and as a result, the premiums may be tad higher. When compared to this, CPP comes across as a cost effective measure, that too only for a frequent traveler.
The other notable benefit comes in instances of fraud, which is a notable plus. However, when it comes to claim settlement, which is a moment of truth for the customer, there is room for disappointment. Incase, if it found that the cause of fraudulent activity was a result of personal negligence, then there is fair chance of the claim being rejected.
Also, it is important to note that the services and their limits vary according to the plan chosen. Consequently, incase one opts for a basic plan; there may be instances when certain services, especially the ones available overseas, may not be offered. In a nutshell, go for it if you are a card junkie and a frequent traveler.

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Thursday, 9 June 2016

09:08

SBI launches ATM-based facility to e-verify IT returns

SBI launches ATM-based facility to e-verify IT returns

State Bank of India launched an ATM-based facility on June 3 to create Electronic Verification Code (EVC) for e-verifying various forms available with the Income Tax Department.
This facility is aimed to make filing and verification process more digitally accessible to customers who have not opted for net banking.
"Now, Electronic Verification Code (EVC) can be generated by pre-validating your Automated Teller Machine (ATM) provided by the bank where a taxpayer has an account. While SBI has activated the facility beginning yesterday, other banks will follow soon," a senior official said, reported PTI.
While EVC can be used to e-verify various forms even in the absence of Digitally Signed Certificates (DSC), it is mandatory for the user to register DSC to e-verify Income Tax Returns (ITRs).
E-verifying was introduced in May this year by the I-T department to reduce paper work associated with verification. Prior to this taxpayers who submit forms had to produce a paper-based Income Tax Return-Verification (ITR-V) form which had to be sent by post to the Central Processing Centre in Bengaluru.
The I-T department already introduced three e-verifying methods while e-filing forms through the income tax e-filing website. Anyone could e-verify forms if they have a pre-validated bank account, by net banking or by the OTP generated during e-filing once Aadhar card and PAN card are linked.

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Wednesday, 20 January 2016

07:56

How to claim unclaimed deposits from banks

How to claim unclaimed deposits from banks

It is possible to lose track of bank deposits if financial records are not maintained properly. Also, when a person dies, legal heirs sometimes discover unclaimed bank deposits. The Reserve Bank of India has mandated banks to publish a list of inactive or inoperative accounts for 10 years or more on the bank's website. It is possible for the depositor or legal heir to claim such amounts by following procedures.
Search of records 

The claimant needs to visit the bank's website to check the inactive account details. Only the primary account holder's details can be searched from the list.

Search criteria 
Claimant can search records based on:
1. Name and date of birth
2. Name and PAN
3. Name and passport number
4. Name and pincode
5. Name and telephone number

Claim by self 
If the account holder himself wishes to make a claim, he needs to visit the nearest bank branch and submit the unclaimed deposits claim form which can be downloaded from the bank's website or obtained at the branch. The form needs to be duly filled and should be accompanied with a valid identity and address proof document of the claimant.
Claim by heir/nominee 
In case of claim by a legal heir, he needs to visit the nearest branch and submit the unclaimed deposits claim form. The form needs to be accompanied with valid identity and address proof of the claimant. Copy of death dertificate of deceased account holder.
Process 
After the bank verifies the genuineness of the claim, the status of the unclaimed account is changed to regular and transactions are allowed. In case of claim by legal heirs, the claim settlement procedure of the bank is followed.
Points to note 
1. The claimant is required to carry original documents for verification.
2. Applicable interest for savings bank accounts is credited on regular basis irrespective of the status of the account i.e. operative or not.
3. Banks are required to make all efforts to trace inoperative account holders.
(The content is courtesy Centre for Investment Education and Learning (CIEL). Contributions have been made by Girija Gadre, Arti Bhargava and Labdhi Mehta)
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Friday, 8 January 2016

22:45

Amendment in rules for Quoting of PAN in various transactions (Rules 114B to 114E)

Amendment in rules for Quoting of PAN in various transactions (Rules 114B to 114E)

Background:

In order to achieve a two-pronged target of curbing the circulation of black money and widening tax base, the government has recently notified changes in the monetary limits that will require mandatory quoting of PAN. The finance ministry has also rationalized the monetary limits for certain transactions requiring mandatory quoting of PAN. The monetary limit for sale or purchase of immovable property has been doubled to Rs.10,00,000, and that for hotel and restaurant bills to Rs. 50,000. “In dealing with domestic black money, transactions dealing with cash of more than Rs.2,00,000 will require submission of PAN details,” Finance Minister Shri Arun Jaitley told the Lok Sabha earlier this month while presenting his ministry’s supplementary demands for grants.

As per CBDT notification, PAN will be required for transactions above Rs. 2,00,000, regardless of the mode of payment.Any false declaration of PAN could also land an individual behind bars or a company liable to prosecution that includes a jail term of up to seven years and a fine.

Now there is a reporting requirement on the assessee entering into such transactions. We have given our views on the actions to be taken by such assessees in this regard.

A. Quoting of PAN(Permanent Account Number)[Rule 114B]

Every person shall quote his permanent account number (PAN) in all documents pertaining to the transactions specified in the Table below, namely:-

S.No. Nature of transactions Value of transaction 1 -Sale or purchase of a motor vehicle or vehicle, which requires registration by a registering authority under chapter VI of Motor Vehicles Act, 1988, OTHER THAN TWO WHEELERS, All Such Transactions 2 -Opening an account with a Bank(Other than savings bank account), All Such Transactions 3 -Application for Debit and Credit Card All Such Transactions 4 -Opening a demat account All Such Transactions 5 -Payment to a hotel or restaurant against a bill Payment of more than Rs. 50,000 (if in cash) 6 -Payment in connection with foreign travel or payment for purchasing foreign currency Payment of more than Rs. 50,000 (if in cash) 7 -Payment to a company for purchasing debentures or bonds issued by it Payment exceeding Rs. 50,000 8 -Payment to a Mutual Fund for purchase of its units Payment exceeding Rs. 50,000 9 -Payment to RBI for acquiring bonds Payment exceeding Rs. 50,000 10 -Deposit with a Bank Deposit of more than Rs. 50,000 (if in cash) per day 11 -Purchase of DD(Demand Drafts or banker’s cheques) from a Bank Payment in cash for an amount more than Rs. 50,000 per day 12 -Time deposit with a Bank, Post Office, Nidhi companies, NBFCs Amount of more than Rs. 50,000 per day or more than Rs. 5,00,000 during a financial year 13 Payment of more than Rs. 50,000 in a financial year 14 -Payment for Life insurance premium Payment exceeding Rs. 50,000 in a financial year 15 -Sale or purchase of securities(other than shares) Amount exceeding Rs. 1,00,000 per transaction 16 -Sale or purchase of unlisted shares Amount exceeding Rs. 1,00,000 per transaction 17 -Sale or purchase of any Immovable property Amount of more than Rs. 10,00,000 or if valued by stamp valuation authority, amount of more than Rs. 10,00,000 18 -Sale or purchase of goods or services, other than those specified above, if any Amount of more than Rs. 2,00,000 per transaction
Where a person, entering into any transaction referred above, is a minor and who does not have any income chargeable to income-tax, he shall quote the permanent account number (PAN) of his father or mother or guardian, as the case may be, in the document pertaining to the said transaction.

Further, where any person who does not have a PAN and who enters into any transaction specified above, he shall make a declaration in Form 60 giving therein the particulars of such transaction.

This rule shall not apply to following:

(i) the Central Government, the State Governments and the Consular Offices;

(ii) the Non-Residents referred to in clause (30) of section 2 of the Act in respect of the transactions referred to at Sl. No. 3 (Application for Debit and Credit Card) or 5 (Payment to a hotel or restaurant against a bill) or 6 (Payment in connection with foreign travel or payment for purchasing foreign currency) or 9(Payment to RBI for acquiring bonds) or 11(Purchase of DD(Demand Drafts or banker’s cheques) from a Bank), 13(Payment for prepaid instruments, issued by RBI to a banking company) or 18(Sale or purchase of goods or services exceeding Rs. 2L).

In other words, non-residents are required to either quoting his PAN or giving declaration in Form 60 for following transactions:

S.No. Nature of transactions Value of transaction 1 -Sale or purchase of a motor vehicle or vehicle, which requires registration by a registering authority under chapter VI of Motor Vehicles Act, 1988, OTHER THAN TWO WHEELERS, All Such Transactions 2 -Opening an account with a Bank(Other than savings bank account), All Such Transactions 3 -Opening a demat account All Such Transactions 4 -Payment to a company for purchasing debentures or bonds issued by it Payment exceeding Rs. 50,000 5 -Payment to a Mutual Fund for purchase of its units Payment exceeding Rs. 50,000 6 -Deposit with a Bank Deposit of more than Rs. 50,000 (if in cash) per day 7 -Time deposit with a Bank, Post Office, Nidhi companies, NBFCs Amount of more than Rs. 50,000 per day or more than Rs. 5,00,000 during a financial year 8 -Payment for Life insurance premium Payment exceeding Rs. 50,000 in a financial year 9 -Sale or purchase of securities(other than shares) Amount exceeding Rs. 1,00,000 per transaction 10 -Sale or purchase of unlisted shares Amount exceeding Rs. 1,00,000 per transaction 11 -Sale or purchase of any Immovable property Amount of more than Rs. 10,00,000 or if valued by stamp valuation authority, amount of more than Rs. 10,00,000
Penalty for non-quoting of PAN (Section 272B) – If a person fails to comply with the requirement of quoting the PAN or furnish incorrect PAN then Assessing Officer may levy the penalty of Rs. 10,000.

B. Verification of PAN –[Rule 114C]

Any person who sells an immovable property exceeding Rs. 10L or motor vehicle of any value shall either obtain and verify the PAN of the buyer at the time of sale or shall obtain Form 60 in case buyer does not have PAN.

Any person, being a person raising bills referred to at S. No. 5 (hotel or restaurant) or 6 (foreign travel) or 18 (sale of goods or services exceeding Rs. 2,00,000) of rule 114B, who, in relation to a transaction specified in the said S. No., has issued any document shall ensure after verification that permanent account number has been correctly furnished and the same shall be mentioned in such document, or as the case may be, a declaration in Form 60 has been duly furnished with complete particulars.

Therefore a person who is raising invoices in the above said transactions S. No. 5 (hotel or restaurant) or 6 (foreign travel) or 18 (sale of goods or services exceeding Rs. 2,00,000) shall mention the PAN of buyer/service receiver on the invoice or document issued.

Key points on Form 60

It is a Form for declaration to be filed by an individual or a person (not being a company or firm) who does not have a permanent account number (PAN) and who enters into any transaction specified in rule 114B(mentioned in above table),
It requires the estimated total income (including income of spouse, minor child etc. as per section 64 of Income-tax Act, 1961) for the financial year in which the said transaction is held,
The person accepting the declaration shall not accept the declaration where the amount of income of the nature [estimated total income (other than agricultural income)] exceeds the maximum amount which is not chargeable to tax, unless PAN is applied for and its acknowledgement number is duly filled.
Before signing the declaration, the declarant should satisfy himself that the information furnished in this form is true, correct and complete in all respects. Any person making a false statement in the declaration shall be liable to prosecution under section 277 of the Income‐tax Act, 1961 and on conviction be punishable.
(i) in a case where tax sought to be evaded exceeds twenty‐five lakh rupees, with rigorous imprisonment which shall not be less than six months but which may extend to seven years and with fine;

(ii) in any other case, with rigorous imprisonment which shall not be less than three months but which may extend to two years and with fine.

C. Reporting requirements of Form 60 [Rule 114D]

Every person who have received Form 60 on or after 01 January 2016 in relation to transactions specified in above table, shall be required to file Form 61 to the Director of Income-tax (Intelligence and Criminal Investigation) or the Joint Director of Income-tax (Intelligence and Criminal Investigation) through online transmission of electronic data to a server designated for this purpose and obtain an acknowledgement number and retain Form No. 60 for a period of six years from the end of the financial year in which the transaction was undertaken.

Due date for filing of Form 61:

30th April for declarations received till 31st March

31st October for declarations received till 30th September

Who can file Form 61 on behalf of the assessee?

The Form 61 shall be filed by person specified under section 140 of the Act.
D. Furnishing of statement of financial transaction [Rule 114E]

With effect from 1 April 2016, every person who has undertaken the specified transaction will file the statement for detail of such transaction in Form 61 annually.

Form 61A shall be furnished to department on or before 31st May, immediately following the financial year in which the transaction is registered or recorded.

Further, we have identified some transactions given under Rule 114E, which generally impacts the Company and person other than company who are subject to audit under section 44AB of the Act. The following class of persons is required to furnish a statement of financial transactions under Form 61A for the transactions given below (Applicable for transactions entered on or after 01 April 2016):

S.No. Nature and value of transactions Class of person 1 Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring bonds or debentures issued by the company or institution (other than the amount received on account of renewal of the bond or debenture issued by that company). A company or institution issuing bonds or debentures. 2 Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring shares (including share application money) issued by the company. A company issuing shares. 3 Buy back of shares from any person (other than the shares bought in the open market) for an amount or value aggregating to ten lakh rupees or more in a financial year. A company listed on a recognised stock exchange purchasing its own securities under section 68 of the Companies Act, 2013 (18 of 2013). 4 Receipt of cash payment exceeding two lakh rupees for sale, by any person, of goods or services of any nature (other than those specified at Sl. No. 1 to 10 of this rule, if any. Any person who is liable for audit under section 44AB of the Act.
Now, the seller will be required to maintain the person wise detail of cash sales for computing the threshold limit of Rs. 2 Lakhs received from such person.

The statement shall be furnished electronically by the Company/person other than Company, using digital signature of the designated director/managing partner/proprietor/principal officer.

As per the notification, “Designated Director” means a person designated by the reporting person to ensure overall compliance with the obligations imposed under section 285BA of the Act and the rules 114B to 114D and this rule and includes—

(i) the Managing Director or a whole-time Director, as defined in the Companies Act, 2013 (18 of 2013), duly authorized by the Board of Directors if the reporting person is a company;

(ii) the managing partner if the reporting person is a partnership firm;

(iii) the proprietor if the reporting person is a proprietorship concern;

(iv) the managing trustee if the reporting person is a trust;

(v) a person or individual, as the case may be, who controls and manages the affairs of the reporting entity if the reporting person is, an unincorporated association or, a body of individuals or, any other person.

It is advised that the Company should designate a director as designated director through board resolution for filing Form 61A with the department. Similarly the partnership firms should also designate a partner for complying with the same.

Penalty for non-furnishing of statement will be of Rs. 100 per day of default. However, if he assessee receives any notice from the department for filing the statement then it shall be filed within limit of 30 days from the date of service of notice. In case of such default, the penalty shall be levied of Rs. 500 per day of default.

Information which will be shared by the respective reporting authorities under form 61A and needs special attention of the assessee:

S.No. Nature and value of transaction Implication 1. Cash deposit or withdrawal aggregating to Rs. 50 Lakh or more in a financial year from one or more current account of a person The banking company will share the information of the assessee with the department. 2. Cash deposits aggregating to Rs. 10 Lakh or more in a financial year in one or more saving account of a person The banking company will share the information of the assessee with the department. 3. One or more fixed deposit/time deposit of a person aggregating to Rs. 10 Lakhs or more in a financial year (other than renewal of another time deposit) The banking company or post office or Nidhi or NBFC will share the information of the assessee with the department. 4. Payment by any person of Rs. 1 Lakh in cash or Rs. 10 Lakhs or more by any other mode against bills raised in respect of one of more credit cards issued to that person The Credit card issuing agency will furnish the information with the department. 5. Payment of Rs. 10 lakhs or more for following transactions:
·       acquiring bonds or debentures or

·       acquiring shares including share application money or

·       buyback of shares (other than shares in open market)

·       acquiring units of one or more schemes of mutual funds,

·       purchase of foreign currency,

The issuing company or trustee of the mutual fund or the authorized person as refered in FEMA, as the case may be, shall furnish the information with the department. 6. Purchase of immovable property for an amount of Rs. 30 Lakhs or more The registrar or sub registrar shall furnish the information with the department about such transaction. 7. Cash payment exceeding Rs. 2 Lakh during a financial year for purchase of goods or services The assessees who are subject to audit under section 44AB of the Act shall furnish the information with the department.
The Income tax department may use such information for any further enquiries/investigation; hence it is advisable that correct information is obtained/furnished within the due prescribed time.

(Author – CA Neeraj Kumar, RAPG & Co. Chartered Accountants in practice from Delhi and can be reached at info@rapg.in, 9999836182)

Disclaimer: The entire contents of this document have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. The observations of the author are personal view and the authors do not take responsibility of the same and this cannot be quoted before any authority without the written permission of the author.

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Wednesday, 16 December 2015

22:20

PAN Made Mandatory For Opening All Bank Accounts From January 1

PAN Made Mandatory For Opening All Bank Accounts From January 1

From January 1, quoting PAN or permanent account number will be mandatory for opening all bank accounts, the government announced on Tuesday.
With the aim of checking domestic black money, the government today announced a slew of measures that will make the use of PAN mandatory not just for opening accounts but several other transactions including buying gold or jewellery for Rs 2 lakh or paying a bill of Rs 50,000 at a restaurant.

To reduce bank accounts with forged details, the government has made PAN card mandatory for all kind of bank accounts except those under the Pradhan Mantri Jan Dhan Yojana.

Revenue Secretary Hasmukh Adhia said, "The government is committed to curbing the circulation of black money and widening of tax base. To collect information on certain types of transactions from third parties in a non-intrusive manner, the Income-Tax Rules require quoting of PAN where the transactions exceed a specified limit."

PAN will be mandatory for any transaction of over Rs 2 lakh, regardless of whether it is in cash or through card or cheque. The Finance Minister in his budget speech had proposed a Rs 1 lakh limit.

The Rs 2 lakh limit for disclosure of PAN card is an "interim measure" and ultimate goal is to lower it Rs 1 lakh, Mr Adhia said.

To help small property buyers, monetary limits for quoting PAN has been raised to Rs 10 lakh from Rs 5 lakh for sale or purchase of immovable property. People without a PAN are required to fill a form and furnish a specified document from a list to establish their identity.

In a relief to small investors, the requirement of furnishing PAN for making post office deposit of over Rs 50,000 has been dispensed with.Mr Adhia said the enhanced limits will bring balance between burden of compliance on legitimate transactions and the need to capture information relating to high value transactions.

The move follows the recommendation by the Supreme Court-appointed Special Investigation Team (SIT) on Black Money that quoting of PAN should be made mandatory for all sales and purchase of goods and services where the payment exceeds Rs 1 lakh.

 Source:BankingUpdates
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